When the Fed started raising interest rates in early 2022, I knew Utah's housing market was in for a change. After more than three decades in real estate, I've seen cycles come and go, but this one has been different.

The Utah housing market has undergone a dramatic shift over the past two years, driven primarily by the Federal Reserve’s aggressive interest rate hikes to combat inflation. If you’re buying, selling, or just keeping an eye on real estate in Salt Lake City, Park City, or along the Wasatch Front and Back, you’ve likely noticed the changes—higher mortgage rates, cooling price growth, and more homes on the market.

Two years ago, buyers were waiving inspections, offering $20,000-$50,000 over asking, and praying for just one home to hit the market in their price range. Today? The script has flipped.

Let me walk you through what's happening with real data so you can make smart moves in this new market.

The Interest Rate Earthquake

Here's the backstory:

In 2020-2021, the Fed slashed rates to near 0% to keep the economy afloat during the pandemic. That sent mortgage rates to historic lows (under 3%), and Utah's housing market exploded.

But when inflation hit 9% in 2022, the Fed had to act, and fast. They raised rates 11 times in 18 months, the most aggressive hikes since the 1980s.

What That Means for Mortgage Rates Today:

• December 2021: 3.1% (cheap money = buying frenzy)
• October 2022: 7.08% (biggest single-year jump ever)
• July 2024: 6.8% (still near 20-year highs)

Real-life impact:

For buyers, this means significantly higher monthly payments. On a $500,000 loan:

• At 3.1%: $2,136/month
• At 6.8%: $3,262/month (a 53% increase)

A couple buying a $500,000 home today pays almost $1,200 more per month than they would have in late 2021. That's $14,400 extra per year—enough to cover a family vacation, car payment, and then some.

This jump has forced many buyers to rethink budgets, delay purchases, or seek smaller homes, directly impacting demand.

Home Prices: The Slowdown Nobody Expected

After years of double-digit annual appreciation (2021-2022 Peak Growth: 22% year-over-year), Utah’s housing market has cooled. According to FRED’s House Price Index for Salt Lake City:

The Data Behind the Shift:

📉 Salt Lake City Metro Price Growth (FRED Data):

• 2021: +22% (biggest surge ever)
• 2023: +5% (still rising, but barely)
• 2024 (YTD): +3% (almost flat)

🏔 Park City Luxury Market:

• 2022 Peak: Median price $2.9M
• 2024: Down to $2.6M (-10% from highs)

Key trends in Salt Lake County, Park City, and surrounding areas:

• Fewer bidding wars – Homes now average 30-45 days on market (up from 7-10 days in 2021-2022).
• Price reductions – About 25% of listings have seen price cuts (per Wasatch Front MLS).
• Luxury market softening – Park City’s median price dipped 4% in Q2 2024 (vs. 2023).

What's happening?

• Buyers can't afford the same prices at 7% rates
• Sellers are adjusting expectations
• The market is rebalancing—no crash, but no more "name your price" deals

Bottom line: Prices aren’t crashing, but the frenzy is over. Sellers must price realistically, while buyers have more negotiating power.

Inventory: The Highest in a Decade

One of the most striking shifts? Available homes.

📊 Active Listings in Salt Lake County:

• 2022 Low: 1,200 homes (extreme shortage)
• July 2024: 2,800+ homes (130% increase from 2022 lows).

🏡 Wasatch Front Total Inventory (including Utah County):

• 2021: 1,500 homes (multiple bids on everything)
• 2024: 4,500+ homes (highest since 2014)

Why the surge?

1. Higher rates = Fewer buyers (demand drop)
2. "Golden Handcuffs" – Homeowners with sub-4% mortgages refuse to sell and lose their low rate.
3. Builders are finally catching up – Utah added 18,000+ housing units in 2023 (U.S. Census data).

For buyers, this means more choices and less pressure. For sellers, it means homes must stand out—proper pricing, staging, and marketing are critical.

What This Means for You

If You’re Buying:

✅ More choices. More options = Less rush – Take time to compare.
✅ Negotiation leverage – Ask for closing costs, repairs, or price adjustments.
⚠️ But... Rates are still high. Consider ARMs or rate buydowns

• Adjustable-Rate Mortgages (ARMs) – Lower rates for 5-10 years
• Seller-paid rate buydowns – Temporary rate reductions

If You're Selling:

✅ Invest in presentation – professional photos, staging, and minor repairs help.
✅ Be flexible – Offer seller concessions if needed.
✅ Good news: Prices haven't crashed
⚠️ But... You must PRICE RIGHT & PREP WELL

• Homes priced correctly sell in 30 days
• Overpriced homes sit 90+ days

The Big Question: Where's the Market Headed?

Economists predict:

• Rates will stay near 6-7% through 2025
• Prices will grow 2-4% annually (not 20% like 2021)
• Inventory will stay high (but not enough for a "buyer's market")

My Advice:

• Buyers: Don't wait for a crash—just shop smarter
• Sellers: Price aggressively & make your home shine

Final Thought:

In the road ahead, today’s market dynamics are likely here to stay. While Salt Lake City and Park City aren’t seeing the explosive growth of 2021-2022, Utah’s strong job market and population growth will keep demand steady long-term.

Need Help Navigating the Shift?

Whether you're buying or selling, the key is adapting to the new normal, and it is crucial to hire an agent with proven experience guiding clients through market shifts to prevent expensive errors. Avoid market shift pitfalls by working with an agent who's weathered these changes successfully.

I've helped over 1,200 families buy and sell homes through booms, busts, and everything in between. Whether you're:

• A first-time buyer worried about rates
• A seller unsure how to compete
• An investor looking for opportunities

Reach out to get personalized advice. I’ve helped clients navigate the ever changing real estate market for 36 years, and I’m here to guide you.

📞 Call or Text: (801) 680-8020
📧 Email: rex@utahrealtyguy.com
🌐 More market insights: rexfrazer.com

Data Sources: Federal Reserve (FRED), Wasatch Front MLS, Salt Lake Board of Realtors | Photo by Jakub Żerdzicki on Unsplash